Tax Effects of Budget Enacted

June 2, 2009 New Zealand FinanceNew Zealand Taxation  No comments

The effects of changes to taxation in the new budget has been enacted by Parliament.

The changes to taxation brought about by the new budget have been passed through Parliament under the Taxation (Budget Tax Measures) Bill. It was introduced under urgency n the same day as the budget, the 28th of May, it passed and received Royal Assent the following day. The weekend and public holiday meant that it was only enacted on the following work day, the 2nd of June.

The Taxation (Budget Tax Measures) Bill repealed sections of the Taxation (Urgent Measures and
Annual Rates) Act 2008, which pertained to future cuts to personal taxation, as promised by the National Party during their election campaign.

The second section of the Taxation (Budget Tax Measures) Bill deals with the abolishment of the Kiwisaver mortgage diversion facility. Specifically, every section pertaining to the enactment of mortgage diversion now reads that to sign up one had to apply before the 1t of June, effectively rendering it an impossible task.